Evidence of Carry Trade Activity
15 Pages Posted: 28 Jun 2012 Last revised: 29 Sep 2013
Date Written: September 1, 2007
Interest rate differentials have been a driving force behind exchange rate movements in recent years. This has focused market attention on the role of currency carry trade positions, and on the possibility that a sudden unwinding might adversely affect financial stability. However, carry trades are notoriously difficult to track in the available data. This special feature first outlines the investor base and trading strategies used in carry trades, and then explores various sources of data to gauge activity.
Keywords: carry trade, BIS banking statistics
JEL Classification: F31, F32, G15
Suggested Citation: Suggested Citation